A better way to look at valuations is to ask whether the stock will re-rate, de-rate or stay the same in terms of valuations and what will be the factors for these to happen.
#StockMarket #StocksToTrade #EconomicPackage
#StockMarket #StocksToTrade #EconomicPackage
I think looking at valuations as to whether they are high, low or fair in absolute terms is not very helpful.
Markets are a combination of Fundamentals + Perception. And trust me perception can keep valuations different from fundamentals for a very long time.
Markets are a combination of Fundamentals + Perception. And trust me perception can keep valuations different from fundamentals for a very long time.
Looking in terms of whether valuation will re-rate or de-rate allows you to avoid going into numbers game of say 80PE is high and 10PE is low. Plus, it prevents you from arguing with what the market is showing you.
This allows you to avoid going into numbers game of say 80PE is high and 10PE is low. Plus, it prevents you from arguing with what the market is showing you.
And frankly agreeing and understanding what markets is showing you can still help you make decent money over time.
And frankly agreeing and understanding what markets is showing you can still help you make decent money over time.
@threadreaderapp unroll
